India Ethanol Demand to Surpass 3.8 Billion Litres by 2021
by Chem Analyst Chemical Database PriceAccording to ChemAnalyst report,
“India Ethanol Market: Plant Capacity, Production, Operating Efficiency,
Technology, Process, Demand & Supply, Grade, Source, Purity, End Use, Distribution
Channel, Region, Competition, Trade, Customer & Price Intelligence Market
Analysis, 2015-2030”, India
Ethanol market grew at a CAGR of around 12.50%
during 2015-2019 and is projected to grow aggressively during the forecast
period. Increasing petrol-Ethanol blending to reduce carbon emissions from
gasoline, backed by strenuous efforts of the Indian government to curtail
imports of crude oil and establish an Ethanol economy will drive the India
Ethanol demand during the forecast period. Moreover, India’s strong ties with
major Ethanol economies which would provide advanced ethanol production
technologies would further drive the Ethanol demand over the coming years.
Browse Complete Report : India
Ethanol Pricing
Ethanol (also known as ethyl
alcohol), popularly known as alcohol, is consumed in alcoholic beverages such
as beer, cider, wine, spirits etc. all over the world. Apart from beverages,
Ethanol serves various other sectors such as industrial solvent, fuel and fuel
additives, chemical intermediates, disinfectants etc. Because of its
broad-spectrum germicidal properties, Ethanol also finds several applications
in disinfectants such as in alcohol-based hand sanitizers. Increasing demand
for disinfectants with rising health consciousness among people will further
escalate the Ethanol demand in the coming years.
Chemical-Pricing: https://www.chemanalyst.com/ChemicalPricing/ChecmPriceYearlyChart?Customer=False
Fuel and fuel additives account
for a larger share of the Ethanol consumed with increasing gasoline blending
targets proposed by the government of India every year. Government’s National
Biofuel Policy 2018, which aims to achieve the Ethanol blending target of 10%
by 2022 and 20% by 2030 from the current rate of 2-3% Ethanol blended petrol
(EBP) target every year, has significantly supported the growth of Ethanol
market in India. Moreover, through its strong
ties with Brazil and other nations which have been at the forefront of biofuel
adoption globally, the Indian Ethanol industry is heading towards novel
developments in its policies and production technologies.
However, outbreak of COVID-19
rendered an unprecedented crash in the global fuel consumption as operations
remained halted for most of the fourth quarter of 2020 due lockdown measures
taken to contain the virus spread. Despite downfall in fuel demand, Ethanol
players remained optimistic as the demand from the hand sanitizer segment touched
record breaking highs as Ethanol serves as an essential ingredient in the
production of alcohol-base hand sanitizers. Ethanol, being a germicidal has
been recommended by WHO for potentially active against the virus. To cater to
the soaring demand, domestic sugar mills such as Indian Sugar Mills Association
(ISMA) and All India Distiller Association (AIDA) increased their produced
Ethanol outputs thereby supporting their annual performance.
According to the report, corn and
sugarcane are common feedstocks for fermentation ethanol. Sugar beet, cassava
and damaged food grains like wheat, broken rice, rotten potatoes etc. can also
act as ethanol sources, while synthetic ethanol’s primary feedstock is
ethylene. The National Policy on Biofuels – 2018 also allows the use of excess
food grains, with the approval of National Biofuel Coordination Committee for
producing bioethanol. Indian government’s initiative to incentivize farmers to store
what typically is thought of as agricultural waste, is expected to boost the
Ethanol production in the country. Moreover, India’s large-scale sugarcane
production is likely to benefit the domestic ethanol producers in the forecast
period. Additionally, heavy investments in Ethanol production technologies
would further propel the expansion of the domestic Ethanol industry. In FY20, India’s
northern Haryana government planned to build a new 100 kl per day 2G-Ethanol
plant using both sugarcane residue and paddy straw as raw materials.
According to ChemAnalyst report, “India Ethanol Market:
Plant Capacity, Production, Operating Efficiency, Technology, Process, Demand
& Supply, Grade, Source, Purity, End Use, Distribution Channel, Region,
Competition, Trade, Customer & Price Intelligence Market Analysis,
2015-2030”, the India Ethanol market has been segmented into North, West,
East and South regionally. Sugar mills in states of Maharashtra and Uttar
Pradesh are projected to account for 40% and 30% of the fresh ethanol capacity
additions in the period of forecast. However, despite steady increase in
Ethanol production, India is still a net importer of Ethanol from the U.S. The
key players operating in the Indian Ethanol market are India Glycols, Bajaj
Hindusthan Sugar, Shree Renuka Sugars Ltd., Triveni Engineering &
Industries Ltd., Balrampur Chini Mills Ltd., Mawana Sugars Ltd., HPCL Biofuels
Limited, Jeypore Sugar Company Ltd., Simbhaoli Sugars Ltd., BSM Sugar and E.I.D
Parry India Ltd. With huge capacity expansion plans scheduled on the cards, India
can become one of the largest Ethanol producers in the world. Indian Currently,
the Indian government is evaluating over 150 proposals from sugar mills planning
to set up new facilities or expand their existing plants. Government of Uttar
Pradesh has put forth an INR 100 Cr investment plant to upgrade its cooperative
sugar mills. Indian Oil and SunLight Fuel are also planning to foray into
Ethanol production with over INR 2,500 crore greenfield investment.
“India stands third in the list of world’s leading crude oil
importers and the fact puts forth the need before the country to reduce its
reliance on imports and channelize the savings. In FY20, honorable Prime
Minister Narendra Modi presented the idea of lowering country’s import
dependence in oil by 10% to cumulatively reach 67% by 2022, the year which marks
75 years of country’s independence. India’s Ethanol consumption stood at 3.8 billion
litres as of 2020 and the idea of mandatory E10 blending alone would require
around 1.5 billion liters of Ethanol annually. To accomplish such an ambitious goal,
India needs to work on its policies towards pricing, procurement, and blending.
E10 fuel blending plan will importantly offer an alternative to the country’s
nearly 50 million sugarcane producers who are dependent on government sugar
subsidies. Factors such as large-scale sugarcane production, urgent need to
reduce pollution levels, government initiatives to support Ethanol production
such as Pradhan Mantri JI-VAN Yojana etc. are expected to drive the Ethanol
market prospects in the forecast period. Moreover, the recent Memorandum of
Understanding (MOU) signed between India and world’s foremost biofuel giant, Brazil
which entails technical collaboration and technology adoption such as
second-generation Ethanol would spur the Ethanol demand outlook. In addition,
rising hand sanitizer consumption post the pandemic would also prove to be a
gamechanger for the industrial Ethanol “, said Mr. Karan Chechi, Research
Director with TechSci Research, a research based global management consulting
firm promoting ChemAnalyst.
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